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An employee code of conduct protects your business

One of the best ways to protect your business from discontented employees is to have a well-developed code of conduct.

A company's conduct code lays out clear expectations about what is expected from its employees. It also insulates you if you need to take disciplinary action against someone who has flouted the rules and involved your business in a scandal that threatens its image or stability.

For example, the Google employee who took it upon himself to send out an internal memo about how he felt women were unqualified for certain positions by their very nature was eventually fired. Google was able to dismiss him thanks to their conduct code -- which prohibited advancing gender stereotypes in the workplace.

Tips for a well-defined code include:

  1. Keep the language plain, in order to avoid ambiguous statements.
  2. Make a list of whatever you find important given your profession's expectations and standards.
  3. Don't forget to include basics, like prohibitions on in-office gambling, illegal acts, discrimination, violations of confidentiality, theft of real or intellectual property and lying to management.
  4. Review the code carefully to make sure that it doesn't contain any conflicting information. In addition, make sure that it doesn't conflict with any other documents, like training materials or statements found in the employee handbook.
  5. Make it clear what the penalty can be for violations of the code.

Experts suggest that you have each new hire at your business review the code as part of the hiring process and then sign it. (The employee should also keep a copy.) That turns it into a legal memorandum that should be preserved in that employee's file.

Make certain that the employee actually does review each line item in the code -- do not allow a new hire to simply sign off on the document without looking. Some companies have new hires initial each paragraph or point laid out in their documents as they are read. That can insulate the company against later charges that something so important was slipped in with other documents and not clearly pointed out to the employee.

While you can write a conduct code yourself, some companies prefer to involve an attorney who handles small business law to assist them.

Source: smallbusiness.chron.com, "Employee Code of Conduct," Matt McKay, accessed Dec. 28, 2017

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